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Luke Williams - Frontiers of Interaction 10

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He is a Fellow of Frogdesign, which is a global innovation firm and he is a Professor at the New York University Stern School of Business where he teaches innovation at the MBA Program and he is a book author, he just finished his new book which is going to be released next January... Ladies and Gents, please welcome to Frontiers 2010 Mr. Luke Willliams! [applause] Sorry Luke, I am redoing this... Ladies and Gents, please welcome to Frontiers 2010 Mr. Luke Williams! [cheering, applause] Thank you, thank you... Thank you, Matteo! It is a pleasure to be here at Frontiers, and it is a pleasure to be in Rome. As you can probably tell by my accent, I am from Australia originally. I now live in New York, but I have to say, and I am not just saying it for this audience, that Rome is my favorite city in the world! [applause] And I am thrilled to be back. From Australia we have about 200 years of history which is not a lot, and it's amazing even outside of this conference, to see something that is 2000 years old just in the ground. Now, as Matteo said, I work for Frogdesign, which is a global innovation firm, and I am Professor of Innovation at New York University, which means that I have a lot of conversations around innovation with people. And there is this one company which keeps coming up again and again in these conversations, and you can probably guess who they are, I can see their products all over this hall, and that company is Apple. So I am going to start the presentation talking about Apple, because it is hard to have a conversation about innovation without speaking about Apple, and I am going to end the presentation on an example, that probably nobody talks about with regards to innovation. So the first thing is, when working for a global inovation firm, when you're talking about Apple, and designing inovation programs or strategies for clients, often what they'll refere to is products like the iPhone which have had enormous impact. And they'll talk about how it innovated at the system level, and a whole bunch of other things. But when we say to them "what do you really love about the iPod?" and that was particularly when this craze started. Inevitably, 9 times out of 10, they would say, the first thing that came out of their mouth was, you like it because it looks clean. It's such a clean design, it's such a clean system. Wow, this word "clean" keeps coming up a lot. I mean we know it's a simple design, we know it's white and hardly got any buttons, But why does everybody always say it's so clean? Now a designer, trying to figure this out, came into the studio with a bit more excitement then usual one morning, and he said, "Luke, I've got it! I know why people perceive the iPod as looking clean." He said "I was sitting on the toilet last night," now this is where most good ideas come from, "and I was looking around and I saw the white porcelain of the bath tub, and I saw the chrome on the faucet, and I thought that's it! People perceive the Ipod as looking clean, because it's materials referenced bathroom materials." KInd of make sense. Although, if you look at my bathroom I wouldn't have the same association. Now, we thought this was an interesting insight, but wehen we dug a bit deeper, we thought. "there's got to be something behind this, this couldn't just be a funny coincidence." So we looked up the bio of the man behind the Apple products, Jonathan Ives, who heads up national design at Apple, and this is what his bio basically says. Word for word. The job that he had before starting at Apple he worked for a consultancy in London, called Tangerine. And Tangerine did a hell of a lot of work in wash basins. Now weather he did this deliberately or not we have no idea, this is just our opinion, and Frog Design had nothing to do with the design of the iPod, However, the connection is interesting isn't it? And that's what I'm going to be talking about in this Keynote. Making those random connections that are seemingly unconscious. Because like it or not, everyone of us, everyday, interacts with a set of conventions that represents cleanliness. And most conventions are bathroom conventions. So consciously or subconsciously those conventions are shaping our perceptions. Now I want to talk about 3 things to build on that. And it's about disruptive thinking and disruptive strategies, and disruptive expectations. So we're going to start with disruptive strategies. Now, to continue talking about inovation I said before Apple comes up a lot. The other thing that comes up a lot when you're speaking about inovation, is this word competition. Because most of the time the reason we're innovating is to differentiate. To gain an advantage over competition. And when we have discussions about competition, what we hear all the time coming up is Everybody has a simular definition of what it means. And this is rooted in a long long history. If you look up the definition, the Latin origin of the word competition, it actually means "to seek together". Meaning, we choose to run in the same race. And that always for me congers up happy times. It's like two competitors holding hands, sort of running the field of daisies, with big smiles on their faces. Because we're all agreeing to play by the same rules. Now I don't know who this guy is, he's just the happiest man I could find. Reminds me of Santa Clause or something. So it's this very happy notion of competition. Now when we're talking about thinking un-thinkable, and how to start disruptive innovation, You need a different definition of competition. And what we try and think about, and what I encourage my students to think about when they're coming up with disruptive strategies, is this. It was a quote from a rock band singer. This was the leader of a band called The Grateful Dead, Jerry Garcia, and he said "We don't want to be considered the best at what we do, we want to be considered the only ones that do what we do. The only ones. And that's the essence of disruptive strategies. Now when you're talking about being the only ones, it doesn't look like this, it looks more like this. Frighting, because you don't know where you're going to go, you don't know whats going to happen. Does anyone know where this image is from? Psycho Now the important thing about that film and at that moment, up until then, up until Janet Leigh got stabbed in the shower, it was just a robbery film. I mean they'd stolen a suitcase of money and that's what the film was about. But then suddenly she gets murdered in the shower, and we're asking ourselves, "Why was she murdered?" Where did this mysterious man come from? And that's what they call in Hollywood, a turning point. That is the turning point in a film. Meaning, it takes the film in a new direction. That you weren't expecting. And that is the essence of a disruptive strategy. Looking for a turning point in your market, category, industry. What is going to change the trajectory, the course of that. Category or industry segment. Whatever you're focused on. So you're looking for those turning point moments. Now I want to continue talking about Apple for a moment, because Frog has a long history of working for them. And we've been fortunate with our clients to work with many people that could be considered the only ones who do what they do, and one of those people Steve Jobbs. Now this was when Apple was just getting started when our relationship really began. And that was back when Apple had had some early success. But he started to see what companies like Sony, Louis Vuitton had done with design, and design language, and he wanted the same success for Apple So he had a competition, now a small firm called Frog Design that started in Germany, won this competition and moved to California. And they were pretty happy about that. So it was an exclusive design contract. Now, the project that was started was called snow white. And I love these old documents, I mean they were literally before the days of scanning really They were going around photo copying Disney books and putting them into the brief. It was call;ed project snow white, you can see Steve's signature up there, 1982. And it was called snow white because he wanted an exploration of 7 products. So it was snow white and the 7 dwarfs. And these were the products, we had bashful, which was a notebook computer, so they had been thinking about this for quite a while. Sorry a pad computer. You've got doc and all in one form no one goes through all of them, You've got grumpy, the printer. I always thought that was a great name for a printer. Got happy. You can see that all in one form, which was again continued through with the development of the first iMac. And the single button mouse etc. Now this exploration led to the development of the first Macintosh SE, or the influence of that design. Now I tell you that to say, because we are talking about disruptive strategies. Now when you want to create a disruptive strategy, it's very important to have a clear essence of what you want. Now normally, when an innovation firm or anybody gets a brief to do something new, it's full of requirements. So we want i to be this price point, we want it to be aimed at this target segment. If you're talking technology products it has to be this fast it has to have this much memory. Lists and lists of requirements in a brief. Now when Hartmen Eslinger, who was the founder of Frog Design asked Steve Jobs what he wanted from these computers and the essence of Apple. He simply said this... I want Bob Dylan songs. That was his brief for the project I want Bob Dylan songs. Now I am assuming that most of you know Bob Dylan but if you don't I think we've got a song here. [Bob Dylan song playing] Now the main thing about a Bob Dylan song if you had to characterize it is that a lot of people characterize it as poetic. So Apple wanted poetry in their products. They wanted an emotional connection, OK. The other thing that's characteristic of a Bob Dylan song is that he often runs in the opposite direction. In fact, if you really want to understand innovations, study Bob Dylan's carrier. As soon as he gain success in one area and a fan base, he goes off and abandons that success and creates something completely new, and a whole new set of fans. And he does that continuously so as soon as the competition catches up, he's already moved ahead. And that's the essence of what Apple was talking about with what they required for their strategy. You can see that, they are always moving ahead. So it's running in the opposite direction. Now I read a book recently, a great book by a Cambridge professor, called "How the weak win wars" And there's a lot of parallels here. What he did is study over the last 200 year all of the conflicts that have happened worldwide. And what he found was basically this; That similar strategic approaches favor the strong players, the strong combatants. While opposite strategic approaches, favor the weak. So it's another way of saying, if you're creating anything new, you're always going to be in a weaker position. You're goin to be going up against an established player , and established product, and established brand, and established service. You're always going to be in the weaker position. So don't think like Goliath, don't think like these normal rules of competition and stand toe to toe. If you acknowledge your weakness and say we're the underdog in this situation, and not play by Goliath's rules, you win. What he found was, when he reanalyzed the data he found that with unconventional strategies, the winning percentage jumped from 28.5 to 63.6. So don't think like Goliath, think like David. This is the mindset that great innovators have like Jobs that we talked about, there's Os from Amazon. Richard Branson, even Mark Andrase who did Netscape and now me. They all have this mindset, this David mindset. And the latest example of this is actually this guy... Elion Musk. No he started a a car company called Teslon Now Tesler created an electric vehicle which was a $100,000 sports car. Which had the performance of a sports car so it went from 0 to 60 in 24 seconds and it had a long range. So they created this car to say that, this is what you can do with electronic vehicles. Nobody thought they could do it. Everyone though they were mad. Electronic vehicles have failed etc. Now this is how General Motors reacted. Bob Lutz, who was the big vice president of product development at General Motors, said "all these geniuses here at General Motors kept telling me that lithium-ion battery technology" which is what they used "was10 years away" That's not just us saying that Toyota agrees. And he said well how come these tinny winny guys from California, who knew nothing about the car business, could do this and we couldn't. And this right. Tesler, they weren't car guys, They're computer guys. They are in Silicon Valley. But they wrere able to do this when the established players and the major players weren't. And this is why we all need to think like David We have to have that outsiders mindset to change things in an industry. Particularly, even if you work inside a company you have to have this mind set. And he said that was the crowbar that helped us break the logjam. Because we all get stuck in these patterns, and it's often the outsiders of an industry that come in and break these patterns open. So this is what I want to talk about next. I want to talk about disruptive thinking and why we get stuck in these patterns. Why we get into these logjams. It was Picasso that once said that every child is born an artist, the challenge is to remain an artist when he grows up. Think about it. You watch children playing they're all creating, they're all designing. They're highly motivated designers. Designing responses to the world. Now what happens is they gradually start to learn the adult way of doing things. Meaning the right way of doing things. And what happens when they are learning the right way is the design motivation fades away. And by the time we reach adulthood, particularly through a lot of forms of education, we're so established in our patterns and we've forgotten how to be creative. Now this is what they call "patterns of perception" So you might see the red arrows here, think of that as all the incoming information that comes into you from the world around us. What your brain does is set that information up into sequences, which become patterns. And this is what experience is. Experience in any field is building up a stockpile of these patterns. This is what education is. When you're being educated, you are being tought patterns. Particularly in business school. In business school students are often tought case studies. Which are building up existing patterns. So when they identify a problem that seems similar to that case study, they can apply that standard solution or they'll know a solution that might work. Now these patterns are so powerful that we need to acknowledge they're there. Often we forget and we don't even know. But this is outsiders can often have a new perspective. Now to show you how powerful they are I'm going to show you a quick video. I'm assuming some people here have seen a movie called "The Shinning" Now The Shinning is a horror film, it's one of the most horrific films ever made. As you can see this woman is not having a good time. It was based on a Steven King novel, scary scary stuff. Now they had a competition a few years ago for assistant editors. These are the guys stuck out in the back room no getting any of the glory. They said let's have a competition just for these guys. See what they can do. So the rules for the composition were simple. They had to create a new trailer of a famous film to shift your perceptions of what that film was about. Shift you perceptions of what the film was about. And this is what the winner came up with. Meet Jack Torrence. "I'm outlining a new writing project" He's a writer looking for inspiration "Lots of ideas, no good ones" Meet Danny He's a kid looking for a dad. Jack just can't finish his book. I don't want to sound melodramatic but there's no way to make it economically feasible. Here's to 5 miserable months. But now, sometimes, what we need the most is just around the corner. I'm your new foster father I'd do anything. [happy music playing] Shining So what just happened there was quite easy for them to do. Your patterns for a horror film are just as strong as your patterns for a romantic comedy. So all the creators of this video had to do was change the conventions that give rise to those patterns. Right ? So soft voice over, the Peter Gabrielle sound track, Actually we tried this. You can put Peter Gabrielle in anything and it will soften it up. Now what happens, and the humor part is interesting too, because humor and creativity work in the brain the same way. Doctor Edward DeBono discovered this back in 1969. And that is, you know when you've been told a joke, it's a very linier process. So, you know, man walks into a bar, walks up to the bar tender, asks for a beer, you're being lead along a linier story line. Now then the punchline comes, and it's off to the side. It's unexpected. You didn't see it coming. But the important part is when you hear the punch line it relates back to the start of the joke. Relates back to where the joke started. Because if it was just unexpected and random it wouldn't be funny, it would just be unexpected and random. So a punch line for a joke has two critical components. It has to be unexpected, so it has to catch you by surprise, and it has to be logical in hindsight. Logical in hindsight so it relates back to where the joke started. And this is exactly the same for creative insight. These Ah Hah moments. It works in the brain the same way. A true insight is unexpected, but logical in hindsight. Meaning you recognize the value of it. You know it's a good insight because it relates back to whatever problem or focus that you were starting with. So there're the two characteristics, unexpected yet logical that we aim for. And this is important that everybody develop fluency in this. Coming up with these unexpected strategies. These unexpected insights. Because we can't just rely on a small portion of the population to do this for us anymore. Competition has moved on. You know this graphic represents what a lot of people are saying is we're leaving the information age and we are entering or we have entered a new age. Which they coined the creative age. The conceptual age. And sometimes the disruptive age. Meaning we all have to develop a fluency and competence with the skills of creative thinking. It's not business as usual anymore. Nobody says this better that Thomas Friedman who wrote The World Is Flat, and talks about globalization, is a New York Times columnist. What he says is "there's an absolute premium on the imagination now, on the idea". If I had to point to two that I would say are not commodities OK. The first is imagination. The ability to nurture creative people who can spin out ideas. Couse in this world today, in this intertwined world, I call this flat world, everything today is a commodity. You can get yourself manufactured somewhere, you can get branded somewhere, you can get the logos somewhere, you can even get a design somewhere. What you can't get is the idea. What you can't get is the idea. And that leads us to this third section. The critical part about developing an idea, an unexpected solution, is what we all the expectation gap. So that's the gap between what is expected, and what is delivered. In a positive way. Think about how much people, we all sleepwalk through life. Think of the normal routines we get into everyday. The normal way of seeing. And we miss so much around us. This is an interesting video of a company called Improve Everywhere based out of New York. And they deliberately try and disrupt peoples normal routines. Think of your morning commute, how often do you take the same train, take the same route when you're driving or riding a bike. What they decided to do was go to Grand Central Station and he organized 200 people, volunteers, to stand in place at the same time. Just freeze. And this is what happened. You see that guy over there? They stopped what they were doing and just stood like, like frozen. How long has this been happening? I don't know. I just walked in has it been going on for a while? No this guys just dropped the papers a couple minutes ago. About a minute ago, not even. Look at that lady over there. It's like everybody. Yea There's hundreds of people frozen everywhere. This is wild This is so weird isn't it? I don't know whats going on. I don't either. So then what happend is they started moving again and what I'm not going to show couse it goes on a little bit more is everybody started clapping and cheering and you know waving. And they've been talking about this experience forever. So when they go home that night and somebody says what happend today? Instead of "oh you know just the usual", they could say "you'll never believe what happened this morning at the train station. All these people just froze in place. So it's an example of the need to constantly create a gap in expectations. Now the benefit of this, and this is a very influential book called The Black Swanis" that says the more unexpected the succes of a new venture, the smaller the number of competitors, and the more successful the entrepreneur that implements the idea. So the more unexpected, the smaller the number of competitors. And it gets back to you want to be the only ones who do what you do. Now you can see examples of this in every industry. The Television industry, OK our expectation is for a long time, was that we adjust our schedule around TV programing. Until somebody created a gap, and said TV programming adjusts it's schedule around you. This was of course TiVo and the whole DVR revolution. Shoes. our expectation is that shoes should be attractive. They are multiple parts and materials, and they are made by shoe manufacturing people. Somebody created a gap that said "what if shoes were ugly, it was only one single material, in one piece. And we used electronics manufacturing know how, instead of shoe manufacturing know how. Any guesses? Crocs Some consider the worlds ugliest shoe. Very successful. Soda. Do you call it soda here or is it softdrink? We take for granted our expectation is that soda is inexpensive, it tastes good, and it's advertised as aspirational. You know Coke and pepsi wrote the rule book on aspirational marketing. This isn't soda, this is democracy in a can. Until somebody created a gap and said what if soda was expensive, it tasted bad, as was advertised as functional. Right? So we're not going to tell you this is democracy in a can, we're just going to tell you exactly what it does. This was of course Red Bull. Video game industry. Our expectation forever was that you play video games sitting down and stationary. Until somebody created a gap and said, what if when you play video games, you're standing up and moving. And this of course was the Wii. And I'm amazed with the story of the Wii. I mean when this came out everybody, Sony, Microsoft, were focusing on more expensive chips to make more realistic graphics. When the Wii came out, it was using graphics technology that were five years old. They destroyed the whole notion that there are gamers and there are non-gamers. I have seen grandmothers playing with the Wii. It's completely opened up the market. Now the original inspiration was from and airbag in a car. An airbag. The accelerometer that controls and airbag. They wanted to see what would happen if they put that into a controller. So again it's a random connection. Socks. How long have we expected to wear socks that match? So we buy them in a pair, and they match. Until somebody created a gap and said what if we sold socks in sets of 3, and none of them match? Pretty crazy. This was a guy I used to work with at Frog Design Jonas Dore created a company with some partners called Little Miss Matched. And they sell socks in 3's and none of them match. And it's a hit with 12 year old girls. So instead of a whole strategy based on more distribution, or pricing, or anything else, they based the essence of their disruptive strategy on one girl saying to another "hey do you want to see my socks?" Thats the essence of a disruptive strategy. And now they are into furniture, they are into toys, everything. Rental cars. We took for granted forever the expectation was if you wanted to rent a car they would have to see you so you'd have to go there. You'd have to complet paperwork. And they rent cars buy the day. Used to drive me crazy. You know you'd get back 30 minutes late and they'd charge you another day. Somebody created a gap when they said, what if we didn't have to see the customer, they could skip the paperwork, no paperwork, and we rent cars by the hour, not the day. This was a company in America called Zip Car, which has created a completely new rental car model. And as in all great disruptive strategies, it's left the established players, Hurtz and Avis for example, scrambling to catch up. They're coming out with their own offerings of this now. Because it completely changed the game. Recruitment, so HR departments finding a job. This is common in America I'm not sure if it's common in Europe, very often new employees get a signing bonus to start. So here's some extra money to start, sign on. Thats been the expectation forever. Somebody created a gap when they said, what about if we offer new employees a quit now bonus to leave? A quit now bonus. This was Zappos. Very successful shoe company selling shoes online. And I think it's just been acquired by Amazon. They are obsessed with customer service. They put new employees through a 4 month process of learning about how to serve the customer and then they offer them money to leave at the end of that. Now if people take the money, hey no hard feelings. But what that means is they're not committed enough to this way of service that the company has to live by. Restaurants. How frequently we all eat at restaurants so often. What happens is guets choose what they want to eat from a menu that they get when they arrive. Somebody created the gap when they said, guests have no choice in what they eat, and they only get a menu when they leave. Now if anyone knows this example I'm going to be extremely jealous. El Bulli. Has anyone eaten here? It takes 6 months to get a, sorry about 5 years to get a reservation. It's considered the best restaurant in the world. Just outside of Barcelona I believe in Spain. Run by the best chef in the world. Who is considered the best chef in the world by the best chefs in the world. His name is Farran And at El Bulli they'll ask you your dietary requirements before you go. But then you'll get there and you'll have no choice in what you eat and you will go through not 3 courses, you will go through 30 courses, and you will get a menu from the kitchen explaining what you've eaten at the end. Signed by the chef. Now finally comedy. The reason I've got this example in is you can find examples of this everywhere. So what I encourage you to do is to be sensitive to finding those examples in everything that you do. Evereything you observe. Its a sensitivity that you have to develop. Expectation in television comedy. There was a sitcom rule that, it was called hugging and learning. So think of all the sitcoms you've seen where the child goes off and he gets into trouble and he comes back home, and they work it out. Theres a bit of tension but they work it out. And everyone good at the end, and they learn. Until somebody cam along and created an expectation gap and said No hugging, no learning the characters do not develop at all. No matter what they do or how much trouble they get into. And this of course was the American hit Seinfeld. And what I want to leave you with, to conclude is if you want to understand how disruptive inovation really works. It is best to study comedians. Because comedians are professional disruptive thinkers. They're constantly looking for what you take for granted, and they're looking to break that expectation. Now this is a guy called Eddie Izzard who's an English comedian and he's talking about the church of England. As a religion. And saying "it's not a very serious religion, they're not very scary" So the expectation is that they have no extreem points of view. Right? So nobody really is too scared of them. Now he turns that around, he flips it around and says "What abut if they had an extreem point of view" What about if they said "you must have tea or cake with the vicar or you die". Right? Extreem point of view. Now, that's what we call a provocation. And then they imagine it moment to moment. This is what comedians do to play that out. And this is, somebody created a lego animation showing us exactly how this plays out. So I'll show you that now. But you can't do that in the church of England, you can't say you must have tea and cake with the vicor or you die. You can't have extreem points of view. You know the Spanish Inquisition wouldn't have worked with the church of England. Talk will you talk! But it hurts. Well lossen it up a bit will you? Couse that's what be, tea and cake or death, tea and cake or death. Tea and cake or death. Students were there, tea and cake or death. Little red cook book, little red cook book Couse cake or death, that's a pretty easy question, anyone could answer that. Cake or death? Ahh, cake please. Very well give him cake Thanks very much. very nice You cake or death? Cake for me too please. Very well, give him cake too. We're going to run out of cake at this rate. You, cake or death? Ahh, death please. No cake, cake cake sorry. You said death first hay hay! No I ment cake Oh allright You're lucky I'm church of England. Cake or death? Ahh cake please. Well we're out of cake we only had 3 backed and we didn't expect such a rush. So what do you want? So my choice is or death? Well have the chicken then please. Taste of human sir Would you like a white wine? Very good thank you very much Thank you for playing church of England cake or death. Than you everyone, thank you enjoy the conference. Thank you

Video Details

Duration: 37 minutes and 56 seconds
Year: 2010
Country: United States
Language: English
License: All rights reserved
Views: 208
Posted by: frontiersof on May 24, 2011

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